La La La

[Kathianne]

So much noise:

https://hotair.com/john-s-2/2023/02/15/auto-draft-103-n531058


CBO: Deficits will rise to $2 trillion per year over the next decadeJOHN SEXTON 7:05 PM on February 15, 2023

CBO: Deficits will rise to $2 trillion per year over the next decade
Just last month the NY Times published a story about the growing US debt. The story relied on what were, at the time, the most recent estimates from the Congressional Budget Office.


America’s debt is now six times what it was at the start of the 21st century. It is the largest it has been, compared with the size of the U.S. economy, since World War II, and it’s projected to grow an average of about $1.3 trillion a year for the next decade.


Today, the CBO put out a new estimate which is significantly worse. Now the US is projected to average $2 trillion per year, adding another $19 trillion to the debt over the next decade.


The United States is on track to add nearly $19 trillion to its national debt over the next decade, $3 trillion more than previously forecast, as a result of rising costs for interest payments, veterans’ health care, retiree benefits and the military, the Congressional Budget Office said on Wednesday.


The new forecasts, released Wednesday afternoon, project a $1.4 trillion gap this year between what the government spends and what it takes in from tax revenues. Over the next decade, deficits will average $2 trillion annually, as tax receipts fail to keep pace with the rising costs of Social Security and Medicare benefits for retiring baby boomers.


To put those numbers in context, the total amount of debt held by the public will equal the total annual output of the U.S. economy in 2024, rising to 118 percent of the economy by 2033.


President Biden was bragging about cutting the deficit just last week during his State of the Union address. As I pointed out here, what he said was intentionally dishonest and that was before these new CBO numbers. Now it’s clear that deficits will be going up toward the end of his term unless something changes.


The new CBO numbers also point to increased spending on entitlement programs as one of the main drivers of future deficits.


New forecasts from the nonpartisan Congressional Budget Office, released on Wednesday, showed Medicare and Social Security spending growth rapidly outpacing the growth in federal tax revenues over the next 10 years. That is the product of a wave of baby boomers reaching retirement age and beginning to tap the programs, which provide guaranteed income and health insurance from the time benefits are claimed until death…


On Wednesday, the budget office predicted Social Security spending would grow by two-thirds over the coming decade. That’s more than double the expected growth rate for spending on the military and on domestic programs like education and environmental protection…


By 2033, the forecasts suggest, the federal government will be spending as much on Social Security alone as it does on all discretionary spending — military and otherwise — combined…


The trustees of the programs predict Social Security’s main trust fund, for retirement benefits, will run out of money by 2034. At that point, the program’s tax revenues will be able to cover only about three-quarters of scheduled retiree benefits, though Congress could choose to make up the difference with borrowing or additional tax revenue. Medicare’s hospital trust fund is set to deplete its reserves in 2028.


Lawmakers could stabilize the programs by raising taxes, reducing spending or simply continuing to borrow money to keep paying full benefits. A group of liberal lawmakers led by Senator Bernie Sanders, independent of Vermont, has a proposal to expand Social Security benefits and extend its solvency for 75 years through a variety of new taxes on investment and business income, along with earnings for Americans making $250,000 or more.


The CATO Institute put out this chart showing what the growth of these entitlements will look like:

https://hotair.com/wp-content/uploads/2023/02/entitlements-e1676504871797.jpg


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[Kathianne]

Related:

https://www.wsj.com/articles/joe-biden-government-expansion-cbo-budget-forecast-f1302d10?st=mqokzat6jf8mh7y&reflink=desktopwebshare_permalink


Biden’s Federal Budget BlowoutThe new CBO forecast shows the deep fiscal hole Democrats have dug.
By
Updated Feb. 15, 2023 6:43 pm ET

...

White House spinners are boasting that Joe Biden’s Presidency has been historic, and in one sense they’re right. In a mere two years he has midwifed the biggest expansion of government since the 1960s. That’s the real news in Wednesday’s annual budget and economic forecast from the Congressional Budget Office, and the bill for this blowout has only begun to come due.


This CBO forecast is more significant than most because it’s the first comprehensive account of what the last two years of Democratic Party control have wrought. It’s also far enough past the pandemic that it offers a guide to how all of the new spending and tax increases will affect the federal fisc for a decade. You don’t have to be an alarmist to see that the trend is setting the U.S. up, sooner or later, for a fateful reckoning.


***
Federal budget overview and outlook, as a share of GDP
AVERAGE 1973–2022
ACTUAL 2022
2033
Revenues, total 17.4 19.6 18.1
Outlays, total 21.0 24.8 24.9
Mandatory subtotal 10.9 16.3 15.3
Discretionary subtotal 8.0 6.6 6.0
Defense 4.3 3.0 2.8
Nondefense 3.8 3.6 3.2
Net interest 2.0 1.9 3.6
Deficit total -3.6 -5.2 -6.9
Debt held by public 46.9 97.0 118.2
Source: Congressional Budget Office


The nearby table shows how far the Biden revenue and outlay numbers exceed the U.S. historical norm. Revenues last year hit 19.6% of GDP, far above the 17.4% average over the last 50 years, and a share of the economy reached only in 1944, 1945 and 2000. The overall federal tax burden is higher than ever, and the American taxpayer is paying more than his fair share.


Now look at the spending side of the ledger. Outlays reached 24.8% of GDP last year, far above the 21% 50-year average. Under current law, that spending burden will continue with some modest annual changes more or less through 2033. If you’re a socialist who wants politicians to control more of the means of production, Joe Biden is your man.


The federal spending mix is also notable. Defense spending as a share of GDP fell to 3% last year, far below the 4.3% average. It barely grows for a decade under current law. The only times in history that U.S. defense spending fell this low were in 1940 and 1998-2001. No bonus points for noticing these lows came on the eve of World War II and before the 9/11 attacks. Those defense troughs didn’t last.




Meanwhile, so-called mandatory spending for entitlements (Social Security, Medicare and more) hit a new peak of 16.3% of GDP last year, far above the 10.9% average. That will fall slightly as pandemic programs end, but it will accelerate again later in this decade as more of the baby boomers retire.


And don’t forget interest on the federal debt, which is rising fast again as the Federal Reserve raises interest rates to normal levels. CBO estimates that interest payments will gobble up 3.6% of GDP in a decade, which is based on optimistic assumptions about inflation and rates.


Annual budget deficits will keep climbing as a share of the economy—from 5.2% of GDP in 2022 to 6.9% in 2033 when annual red ink will hit $2.7 trillion. In a single year.


As for the much-discussed federal debt, the nearby chart shows how fast it has grown in the last several years. Debt held by the public—the kind we have to pay back to creditors like the Chinese and Japanese based on contracts—is now 97% of the economy, and will soon rise to 100% and keep going to 118.2% in 2033. How high can it go before creditors stop lending? No one knows, but it will be ugly if they do.

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[Gunny]

I thought from the thread title this was going to be your take on Kathianne during a Biden speech :)